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Tesla Motors Inc Model X Launch is Finally Here (But Not Really)

Tesla Motors Model X gets delivered

Tesla Motors Inc , which has yet to get the first Model X Signature versions to those that ordered them, has finally revealed the release version of its EV SUV. The Model X will start at a price of $80,000, compared to the $130,000 charged for the Signature version. It’s open for design right now, but only to those that have booked them already.

Tesla Motors model X shipped
Tesla Motors Fan, and Nvidia boss, Jen-Hsun Huang with his Model X

The Model X Design Studio is now online for those that have already booked a normal version of the Model X. The Studio for those that booked a Signature version of the car opened up in waves starting in September. The Model X came up for reservation way back in the heady days of 2012, when an already over-promising and under delivering Tesla Motors said the car would be ready in a year or two.

Tesla Motors hasn’t put Model X on the market

It should be noted, however, that this morning’s opening up of the Model X Design Studio isn’t anything like a full launch of the Model X. The car still can’t be bought and designed by anybody coming in off of the street. Only those that have booked the car have been invited to design the version they’d like to take delivery of.

Tesla Motors Inc , on its website, says that normal buyers of the Model X should expect it to be delivered in mid to late 2016. It’s not clear whether that is an updated number after the initial waves of orders, or whether Elon Musk is very far behind his promise of ramping up production of the EV SUV in the fourth quarter of 2015.

As we head toward the month of December, and the holidays it brings, it’s clear that nobody who has booked a Signature version of the Model X has taken delivery just yet. In fact those who are first on the list to get the Signature version of the car have not yet been contacted to organize delivery of the car.

Here’s what you can get with the Model X

Tesla Motors has been known to change the options available on its Model S Design Studio over the life time of the car, and sometimes quite quickly, so this is by no means an authoritative list of what will be available for the Model X.

The Design Studio open right now offers a Model X in three seating configurations, seven seats, six seats, which replaces the second row of seating with two single seats, and five seats, which leaves out the back row in favor of massive room in the back. The seven seat version will cost $84,000 rather than $80,000.

It starts at $80,000 for the 70D version before all tax incentives. Packages which may be added include Autopilot, the software not the hardware for $2,500, Premium upgrades for $4,500, Air Suspension for $2,500, a Subzero package for $1,000, better Audio for $2,500 and the towing package for $750.

The advanced air filter announced by Mr. Musk for the Model X is included in the $4,500 premium upgrade package along with the likes of ventilated seats, leather armrests, LED lighting and more.

Tesla Motors has fan support

Tesla Motors is in a sort of lose-lose situation when it comes to Model X news. Any mention of the car brings with it reminders of the failure of the firm’s production machine. The Model X had what was essentially a paper tiger launch on September 29, but not a single Signature version has been shipped to date. 

Tesla Motors is moving ahead rather than looking behind however, as it seeks to capture the public imagination with the falcon-wing spectacularity and new energy optimism of the Model X. Fans of the firm, and it appears many of those that ordered the car in the past three years, don’t harbor too many reservations about supporting Elon Musk and Tesla Motors.

Despite that support some of those that booked the Model X were frustrated by the way it turned out and cancelled their orders. It’s not clear what level of cancellations there have been with the car, but opening up the Design Studio may be a method to slow down the rate at which people are leaving the queue.

Shares in Tesla Motors were flat in pre-market trading on Tuesday morning in the wake of the reveal of the normal Model X design Studio.

Building the Model X

The big issues with building the Model X has been, according to Elon Musk, the second row of seats in the car. Mr. Musk told investors on the most recent Tesla Motors earnings call that the “sculptural work of art” that is the seating has proved hard to get from third parties. Tesla Motors has brought the building of those seats in house as a result.

Setting up a seating  line inside the firm’s Fremont factory is an ambitious, risky move from Tesla Motors. Elon Musk has, time and time again, tried to get across to shareholders that if even a single component in a car his delayed it can hold up his entire production queue.

Given the delays already seen in the Model X, it’s not clear if moving component production inside the firm is the best way to reduce delays in receiving them.

All of this, combined with the huge rate that Tesla Motors Inc  has been burning cash at and concerns about the world economy as a whole, has Wall Street very worried about the future value of the firm.

It’s still one of the more widely followed growth stocks on Wall Street, however, and the price of shares shows that there is, by wide consensus, support on the capital markets for the huge project that Elon Musk has undertaken.

It’s likely to be a rocky few months for the firm however as it deals with ever-delayed production and tetchy capital markets.

The Model X Design Studio launch isn’t so much of a good news story for Tesla Motors as it is a release of tensions for those that have money riding on the EV SUV in a more personal way. Though it’s not likely to speed up their order in any way, it will at the very least feel like some progress is being made toward the goal of getting a Model X.

The open of the Design Studio could be seen as the real launch of the Model X, but in reality we’ll still have a long time to wait before the EV is anything like a production vehicle. Right now it’s not even assured that Tesla Motors will get each of the 2,000 or so Signature versions of the car to buyers before the end of the year.

Putting the design studio out there may generate some buzz for the Model X however, and with no car to sell Tesla Motors is going to have to run on that buzz, and someone else’s cash, for some time to come. Elon Musk reckons that his Fremont plant can build between 1,600 and 1,800 cars per day, including both the Model X and Model S, when up to full speed. For those making use of the Model X studio today, that day can’t come soon enough.

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